Lenny's Podcast: Product | Growth | Career

The rise of Cursor: The $300M ARR AI tool that engineers can’t stop using | Michael Truell (co-founder and CEO)

May 1, 2025

Michael Truell, Co-founder and CEO of Anysphere, shares insights on Cursor, the rapidly growing AI code editor with $300M in ARR. He discusses the evolution of coding, highlighting a shift towards 'vibe coding' that prioritizes design and creativity over traditional programming. Truell reveals Cursor's origin, its pivot from CAD automation, and the decision to develop custom AI models. He emphasizes the importance of 'taste' in engineering and explores the competitive AI tool landscape, advising tech teams to prepare for a future where coding and intuition intersect.

01:11:13

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Episode guests

Michael Truell

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Episode notes

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Quick takeaways

The transition from traditional coding to intuitive software design will empower engineers to focus on logic and intent rather than complex coding.

Cursor's success stems from their pivot to developing custom AI models, which were essential for enhancing user experience and driving innovation.

A diverse and skilled team is crucial for innovation, leading to changes in hiring practices that prioritize alignment with company culture and vision.

Deep dives

The Vision for Software Development Beyond Code

The future of software development is envisioned as a shift from traditional coding to a more intuitive way of specifying intent directly to computers. This transition aims to move away from formal programming languages towards a more accessible representation of software logic that resembles natural language or pseudocode. The idea suggests that engineers will increasingly function as logic designers, focusing on what needs to be built rather than how to implement it through complex coding. This evolution is grounded in the belief that as technology advances, the tools for building software will become more user-friendly and adaptable.

Intro

4min

Envisioning the Future of Software Development

3min

The Future of Coding: Embracing AI and Intuition

17min

Building Cursor: From Prototype to Profit

6min

Innovations in Data Intake and AI Product Development

4min

Navigating the AI Tool Landscape

17min

Recruiting in the Startup Age

18min

Navigating Innovation and Opportunities in Technology

2min

Michael Truell is the co-founder and CEO of Anysphere, the company behind Cursor—the fastest-growing AI code editor in the world, reaching $300 million in annual recurring revenue just two years after its launch. In this conversation, Michael shares his vision for the future, lessons learned, and advice for preparing for the fast-approaching AI future.

What you’ll learn:

• Cursor's early pivot from automating CAD to automating code

• Michael’s vision for “what comes after code” and how programming will evolve

• Why Cursor built their own custom AI models despite not starting there

• Key lessons from Cursor’s rapid growth

• Why “taste” and logic design will become more valuable engineering skills than technical coding ability

• Why the market for AI coding tools is much larger than people realize—and why there will likely be one dominant winner

• Michael’s advice for engineers and product teams preparing for the AI future

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Where to find Michael Truell:

• X: https://x.com/mntruell

• LinkedIn: https://www.linkedin.com/in/michael-t-5b1bbb122/

• Website: https://mntruell.com/

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In this episode, we cover:

(00:00) Introduction to Michael Truell and Cursor

(04:20) What comes after code

(08:32) The importance of taste

(12:39) Cursor’s origin story

(18:31) Why they chose to build an IDE

(22:39) Will everyone become engineering managers?

(24:31) How they decided it was time to ship

(26:45) Reflecting on Cursor's success

(32:03) Counterintuitive lessons on building AI products

(34:02) Inside Cursor's stack

(38:42) Defensibility and market dynamics in AI

(46:13) Tips for using Cursor

(51:25) Hiring and building a strong team

(59:10) Staying focused amid rapid AI advancements

(01:02:31) Final thoughts and advice for aspiring AI innovators

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Referenced:

• Cursor: https://www.cursor.com/

• Microsoft Copilot: https://copilot.microsoft.com/

• Scaling laws for neural language models: https://openai.com/index/scaling-laws-for-neural-language-models/

• MIT: https://www.mit.edu/

• Telegram: https://telegram.org/

• Signal: https://signal.org/

• WhatsApp: https://www.whatsapp.com/

• Devin: https://devin.ai/

• Visual Studio Code: https://code.visualstudio.com/

• Chromium: https://chromium.googlesource.com/chromium/src/base/

• Exploring ChatGPT (GPT) Wrappers—What They Are and How They Work: https://learnprompting.org/blog/gpt_wrappers

• OpenAI’s CPO on how AI changes must-have skills, moats, coding, startup playbooks, more | Kevin Weil (CPO at OpenAI, ex-Instagram, Twitter): https://www.lennysnewsletter.com/p/kevin-weil-open-ai

• Behind the founder: Marc Benioff: https://www.lennysnewsletter.com/p/behind-the-founder-marc-benioff

• DALL-E 3: https://openai.com/index/dall-e-3/

• Stable Diffusion 3: https://stability.ai/news/stable-diffusion-3

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Lenny may be an investor in the companies discussed.

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